Venture Debt: An Alternative Financing Solutions
Introduction Venture Debt There’s no question that equity has a critical role to play in helping founders to meet their business goals. But it is important to recognize that equity is not the only source of startup funding. Using debt to complement your equity funding can be a smart move for stakeholders in a variety of situations, including when they want to: Higher valuation. The valuation of business during the equity funding is critical to the success of the business. Higher the valuation lower the dilution. Companies often use venture debt to extend their runway so that they have more time to grow their business before their next valuation. Secure greater upside. Dilution is a serious consideration during equity funding. By using venture debt to meet a portion of their…